In any year, some households are savers and others, especially retirees, are dissavers
that use past saving to finance current consumption.
Since the saving of younger savers is now high and the dissaving of the older dissavers
is low, the net saving rate is high.
5) In the mid 1970s, young adults who are net borrowers and the retired who are dissavers
dominated the economy, savings declined and interest rates rose.
With population growth there are more savers relative to dissavers
, so that the capital stock grows along with the labor force in steady state.
Their projections call for a slight increase in the personal saving rate from its 1997 level until about 2010, as the effect of the reduction in the share of young dissavers
dominates the effect of the increase in the proportion of old dependants.
More specifically, I show that in the long run, personal saving will decline as a shift in the demographic balance between savers (those in the working ages) and dissavers
(retired workers), and, as a result, economic growth will taper off, especially since it seems unlikely that the decline in personal saving will be offset by increases either in business or government saving or in greater capital inflows from abroad.
The ability of the economy to support this likely low ratio of savers to dissavers
is an important public policy issue, and the effect of various social security reform proposals on it goes unexplored in the book.
Then the positive effects on the market will reverse as boomers retire and the cohort moves from being prime savers to dissavers
It is also evident from Table 4 that both the urban lowest and low income groups are net dissavers
From a life-cycle viewpoint, the baby boomers' retirement will dramatically increase the number of dissavers
vis-a-vis savers, as well as the number of consumers relative to workers.
An economy with population growth will have more savers relative to dissavers
than one with a static population, and so will have a higher aggregate saving rate.
Hogarth reported findings from the Longitudinal Retirements History Survey that focused on characteristics of households which were savers and dissavers
during the first 8 years of retirement.